Gunmen in northern Ethiopia have attacked a group of European tourists, killing five, injuring two and kidnapping four people, according to a government official.

Bereket Simon, the Ethiopian communications minister, said the attackers struck before dawn on Tuesday.

The dead were two Germans, two Hungarians and an Austrian; two Germans and two Ethiopians were kidnapped, and an Italian and a Hungarian were wounded in the attack.

Simon blamed rebels trained and armed by neighbouring Eritrea, which remains a bitter foe. "The attack occurred at 5am on Tuesday, in which Eritrean-trained groups also kidnapped four," Bereket told Reuters. "Two of them are foreigners; one is a driver and the other a policeman."

Eritrea dismissed the allegation as an "absolute lie".

The tourists were visiting the volcanic Afar region, which is one of the hottest places in the world and a known haunt of rebels and bandits from Eritrea and Ethiopia.

Simon said the attack occurred 12 to 15 miles from the Eritrean border. A German media report said the group of tourists had been close to the Erta Ale volcano, one of Ethiopia's most active.

The Afar region is a known haunt of bandits from Ethiopia and Eritrea. Photograph: Reuters

Ethiopian state television reported that there were eight tourists in the targeted group, but Simon suggested the party was bigger.

An Austrian foreign ministry spokesman, Peter Launsky-Tiefenthal, said two groups totalling as many as 22 people may have been attacked, though he said the numbers were unconfirmed.

Girma Asmerom, Eritrea's ambassador to the African Union (AU), said Ethiopia's allegations were "fabricated" and the attack was an internal Ethiopian matter. "This is pathetic, an absolute lie," he told Reuters. "Eritrea has nothing to do with any of these movements."

Eritrea gained independence from Ethiopia in 1993 but the two countries soon became embroiled in border disputes.

The east African countries fought a war from 1998 to 2000, which claimed the lives of about 80,000 people.

"It has become a trend for Ethiopia to fabricate sensational news against Eritrea whenever the summit is nearing," Girma said.

In 2007, five Europeans and 13 Ethiopians were kidnapped in Afar. Ethiopia accused Eritrea of masterminding that kidnapping but Eritrea blamed an Ethiopian rebel group. All of those hostages were released, though some of the Ethiopians were held for more than a month.

In 2008, Ethiopia foiled a kidnapping attempt on a group of 28 French tourists in the area.

Foreigners who venture into Afar usually include researchers, aid workers and adventure tourists visiting geographical wonders such as the Danakil depression and ancient salt mines.

Launsky-Tiefenthal said an Austrian foreign ministry travel warning had been in effect for the region since 2007 "because of several incidents involving attacks on tourist groups ... in some cases politically motivated, in others criminally motivated".

He added: "The problem is, there is no infrastructure in the area. No telephone lines; satellite phones barely work."